Iraq Tensions Push Up July 4th Pump Prices

Drivers heading out for the Independence Day holiday face the highest gasoline prices since 2008 thanks to Iraq tensions, but $5-a-gallon record-breaking prices are out of the question.

Crude prices haven’t even gained more than $1 a barrel on the New York Mercantile Exchange since turmoil in Iraq hit the headlines in the first half of June.

“North American oil prices have advanced by just a few pennies since Iraqi violence put a question mark around the future stability of supply, but U.S. consumers will still see the most expensive July 4th gasoline prices in six years,” according to analysts at GasBuddy.com.

Despite the fact that U.S. oil production is as high as it’s been since October 1986 and gasoline should be well supplied in all states during the holiday, “fear about what could happen if Iraqi exports fall prey to violence has altered the calculus for summer oil prices,” said GasBuddy chief oil analyst Tom Kloza.

Nymex crude futures closed at $104.35 a barrel June 10, when militants known as the Islamic State of Iraq and Syria (ISIS) captured Mosul, Iraq’s second-largest city. Oil futures have gained 99 cents since then, closing at $105.34 as of Tuesday’s (July 1) settlement.

Fuel prices have also climbed, modestly — with the average price for regular gasoline up just about 2 cents since then as of Monday’s $3.676 a gallon, according to AAA.